I have a strong feeling, supported by candles and technical indicators, that the long term top was in place on March 14 at 61468. The previous week and the beginning of this week were very bullish, however, at the end of the month BTC started to react to the resistance at 60141. Today it completed the Tower Top, one of the most powerful multi-candle reversal patterns, on the daily scale and I am not seeing anything bullish for now.
Let’s explore all time frames.
The January and February candles showed a significant selling pressure. The March one looks like a typical continuation candle. But, a little fact that it is entirely above the Bollinger Bands makes it a potentially dangerous reversal flag.
If the April candle is red, it will be bearish no matter the size. If the April candle is green, it will increase the bearish odds even more as it will be even further away from the BB.
Current odds: Bearish
This week started as if it were trying to overcome the bearish pressure. However, after today’s fall, the weekly candle failed to close above the previous red one and this can be viewed as a standard bearish continuation. The BTC needs to close next week below 55051, better below 48895, to continue its path down. A break below the weekly 8 EMA line would be a significant event as well.
There is a very minor chance of bullish reversal, but it is really minor at this point.
Current odds: Moderate Bearish
Today the coin completed the Tower Top in a very clean way, no questions asked. It came after yesterday’s Gravestone Doji/Hammer. BTW, the similar candles were made by Nasdaq and DJ futures and I am really looking forward to seeing their behavior on Sunday night.
Today’s candle decisively closed below the 8 EMA line and it’s a strong sign.
Current odds: Strong Bearish
Based on the very long term perspective, the coin is expected to minimally retrace to the 48000-38000 area in the upcoming months, the blue rectangle. Depending on the way the current wave unfolds, there is also a chance to retrace to 42000-29000 area marked with a green rectangle. This also would be a level of wave IV of a lower degree.
Based on limited data of the wave structure on the mid term daily chart, I am anticipating a retrace to 48000-38000 area (red rectangle) which would be the 1.000-1.618 of the first wave down. This expectation corresponds well with the projection on the very long term chart.
Let’s see how April unfolds.